Starbucks' Schultz: Washington Is Dysfunctional

And politicians are to blame for creating a tough situation for businesses, he said at an industry panel.

NEW YORK ( TheStreet) -- American businesses have never been more challenged than they are today, Starbucks ( SBUX) CEO Howard Schultz said.

"Seismic" changes in technology and "dysfunction" in Washington are to blame, Schultz said early Monday during the second keynote address at the National Retail Federation's annual convention, held at the Jacob K. Javits Convention Center in New York City.

The coffee baron spoke during the panel "Conscious Leadership: a Call to Action for the Retail Industry and Beyond," along with Whole Foods ( WFM) co-CEO Walter Robb and Container Store CEO Kip Tindell. About 27,000 industry participants attended this year's trade show, according to the NRF.

"The rules of engagement for businesses and business leaders have changed. We cannot sit idly and watch Washington take us down a path that we know is wrong," Schultz says. "The burden of responsibility is on us."

Schultz has refrained from contributing campaign money. And the company "took on the JOBS initiative" and -- last month -- encouraged employees to write the phrase " Come Together" on its customers' coffee cups, he says.

The slogan represents "hopeful words for our customers" and was a message for Washington, in an effort to get Congress to come to a deal regarding the fiscal cliff.